Marketing is an art as well as science and to make it successful you should have a soft side to understand the emotions of customers. Mahatma Gandhi was a great man who literally made people to understand the concept of freedom. That’s a far more difficult thing to do. That’s the brilliance of him and we can learn many lessons from him. We operate in 3 businesses and we call ourselves life. We have a good team and we have constantly increased our market share in key categories over the time. When I joined Tata Salt we had the market share of around 19%, today it stands at around 60 -65%. The number 1 & number 2 brands are with us. Because we could not grow the first brand fully, we launched the second brand to attack it & we have two brands from the same family in one product category and we are thinking to launch another brand.
We also sell water purifiers and we have just started to sell pulses, which is a growing business area that is compounded every year at 16000+. When we create a brand the amount of power we have in market place is tremendous. The second piece of our business is industrial chemicals. This is truly a global business; we are present in 4 continents: Europe, Asia, Africa & United States. We are the 2nd largest glass making company. When you drink a glass of water or when you wash clothes there a bit of TATA in it. We are the key supplier to Procter & Gamble & Unilever for same. Our 3rd piece of business is focused on farm essentials. We have the largest foot-print in rural India. Tata rural retail has been profitable from past 20 years. We have 700 stores spread over UP, Haryana, Punjab & in West Bengal. Through our company Ralus we are running one of the finest & profitable rural businesses. When you look at top 10 farm brands, top 7 belong to us. We are about a 15000 crore company and we have an innovation centre too, one of our product Swacch came out of that innovation centre. You cannot address bottom of pyramid without focusing on innovation.
These are the few forces which are impacting us today.
1. Economic Landscape
We can’t do any business activity without understanding the economic landscape. The broad headline is that the foucs is on Asia but the focus is also shifting back to US. US is bouncing back and Africa is a new frontier.
2. Human Capital
Companies have to re-think the way they deal with the available Human capital. So, if you can’t motivate and utilize your human capital, you won’t be able to reach out to the bottom of the pyramid. Here’s an interesting statistic. An Indian born in 2009 will consume 13 times more than an Indian born in 1960. So, we need to focus on sustainability and the social & environmental issues and we need to take care of how the products are affecting our environment. It should be a philosophy that you will encompass the social & environmental issues and you will make the product greener than before. A product which used to last for 5 years will now last for 50 years with the changing needs. If India & China will keep on growing at the same rate, we would need 3 planets to deliver their needs. So, we have to focus on sustainability.
3. Digitization & Technology
There’s a huge shift in terms of work system as well as in products & delivery. We underestimate the power of technology. Here is an example. Not many of us visit banks anymore because of the spread of internet. You can do whatever you need to do with the bank sitting at home. It will actually make a lot of people irrelevant and at the same time it will throw opportunity for people to deliver on the ground.
4. Democratized world
Today, people can make choices and that created confusion but has given lot of opportunities to us too. Social activism and social media has changed the world. India will have 300 billion internet users soon and we don’t know what form or content it will take. India has got one of the highest connections in telephony and we are shifting to smart phones. Smart phone prices have fallen to 1/4th. That’s a tremendous shift on what you can do in advertising, marketing & development space with your consumers. Market starts with servicing the needs & creating products for the consumers. The advent of private equity, venture capital and the freedom to test your models at low cost has created tremendous shift in the market place. Innovation is something which will drive the business.
Here are the 5 take away from Gandhi:
Satya, Ahimsa, Swaraj, Antyodya & Sarvodya.
Sarvodya is serving everybody and Antyodya is serving the last person in queue and these were core of his entire philosophy. You can’t flourish and build a nation is you can’t focus on these two elements. He also focused on Swaraj. For this he was not just referring to British but he was referring to the individual liberation. Facebook and twitter has done the same which provided liberation of thinking and speaking at an individual level. If we look at Ahimsa as a concept, it is related to sustainability and more greenery. He said don’t disturb other living things make a world where all can live together. It is the core of his of philosophy and the core of his philosophy was the truth. Truth well understood is spending time with your consumers with the focus on what the consumer need is to come up with the Ideation for new product and new service. It’s a very intrusive & sustainable process in type as well as form and through this everybody feels empowered & energized. These 5 concepts can be applied to any product area to build fundamentally a very strong pillar for your organization or your business model.
Access is a big difficulty in this country. We underestimate the power & difficulty to engage with our customers. Continuous availability is a big deal. We found that with Tata Salt is a big issue. Provide dignity to your customers.
When we look at the bottom of the pyramid, your room for error is very small because it is such a hard market. You have to be flexible and willing to learn.
One of the first fundamental foundations is need identification. Mr. Ramsharan has given a Bull’s eye definition for same. You need to spend a lot of time. When we sat down to define a water purifier, we had many ways to define it but the simplest is to there are people who have running water and don’t have electricity so can we do something for the water purification for same.
Aesthetic really matters for both bottom of the pyramid & top of the pyramid and we need to look for something inspirational rather than cheap and cheerful. If you look at Tata swacch today, it has won many design awards. It is an outstanding product. Aesthetics costs a little bit but it adds tremendous value to the product. In India we have enough engineers but we don’t spend their services in designing products and that’s why we suffer. The product can be low price and it can have a high appeal to five senses.
Awareness is very important. Many villagers think that drinking purified water makes them weak. Their body uses the resistance that they have naturally and pure water is only meant for the children. This was the misconception which we have to deal with. We had to clear this misconception and this can’t be done by advertising. This could be done by word of mouth or storytelling.
PR is a big deal. We actually had a big PR for our launch but when we went to customers and retailers, they did not recall any of our advertisement, they just recalled the news. To us it became apparent that the part that we have ignored is that below the line activities has huge impact. You have to have a buzz around the product that can come only through story-telling. In villages people understand stories. We were working on a project where we had to make the fishermen aware that they should not kill the whale shark. A fisherman won’t be able to understand this as that’s his source of living. Someone came up with an idea to contacting a spiritual leader and we met Murari Babu for same. He had a brilliant idea and he actually named the shark as the daughter in law of house and he told the fishermen in villages if your daughter will come to your house, will you kill her? So, fishermen said No. Murari Baba said so the shark is the daughter who is returning home You don’t need to kill her and fishermen actually cut their nets to release the sharks. That’s the power of storytelling.
Seeing is believing, that is what we know from our Tata Salt experience. We sell the salt that it dissolves completely and we use it in all our media. When we came up with TATA swacch , our chairman asked us to make a paper which can be dipped in water to check whether the water is pure or impure so that even a villager can test the same and believe in what we are saying.
We were very naïve when we launched TATA swacch in the country. Distribution has been the biggest challenge that we have faced. We are working with non traditional channels & NGOs to cut through the clutter. Technology can be used to reach out to the relevant people.
When we work on chromo pulses with farmers, we realty did not know what would make the farmers stick with us. What we noticed was that when the farmers were receiving an SMS on phone after getting their money in SBI account. That was a big differentiator why they were coming back to us. So, technology is important. You never know which piece of service is making a difference. Innovation never stops, when we launched swacch we thought we have done brilliantly. Though we have to constantly thing what can we change and what can we add to make the product better. The most important thing that I value about my company is Humility. We are always ready to learn and we know that we don’t know everything. It’s a gift that we should build in our team and we can be successful.
The above article is an excerpt from the speech delivered by Mr. R Mukundan, Managing Director,Tata Chemicals at AIMA’s World Marketing Congress which was held in February 2013.
Watch the video here: